Tuesday, February 19, 2013

Mortgage pre-approval or "pretend approval"?

Loan Officer Steve Dunnett lays down the law on mortgage pre-approvals...there's a new sheriff in town!

In the past few weeks I’ve spoken to several customers
who told me that their loan guy had pre-approved them for a mortgage without
running their credit or obtaining any documents. These people were
surprised by the amount of documentation that I had requested in order to issue
a pre-approval for them. I was more than surprised that
other professionals had provided a pre-approval letter to anyone without documentation.

The amount of documentation that needs to be obtained for a loan these days has increased. If a loan officer you’ve spoken to is providing you with a
pre-approval without first obtaining and reviewing your documents than that person is
doing you no favors. In fact, it’s more like they are putting you on a
rickety plane with an inexperienced pilot, no seat belt, and no flotation
device. You could end up swimming in an ocean with the sharks.

Seriously, receiving an unqualified pre-approval and then not being able to obtain
financing could be devastating to you. Before issuing a pre-approval your loan officer should at least be reviewing:

Credit reports

-2 years worth of tax returns

Pay stubs

Bank statements

Without these items you and your lender will not have an accurate picture of your ability to obtain financing. If you received a "pretend approval" OR have any questions about getting a mortgage pre-approval please
give me a call. I would be happy to be a resource for you.

Sold! North Center Land for Sale: Coonley School District $190,000

Real Estate Broker and Author of this Blog

I am a Chicago real estate broker who began writing this blog in 2005. My group represents clients buying, selling and renting properties. I've been awarded Top 5% in sales volume for Chicago Association of Realtors every year from 2006-2015. Thanks for reading and working with us!
All posts and photos are by Eric Rojas and Bob DePalma unless otherwise noted. Contact us at erojas@kalerealty.com for great service!